Virginia Commonwealth University

Make it real.

Many Students Unaware of Tax on Cars

May 7, 2011

By Nan Turner
Capital News Service

RICHMOND – Bumper-to-bumper traffic, pedestrians flooding the streets, quick-changing signals, and the race to find a parking space. Those are things Richmond-area residents encounter when they commute to work or school.

Driving can be unpredictable and even nerve-racking. And there could be an added surprise involving your automobile when it’s off the roadways: a property tax on cars.

Permanent Richmond residents must pay such a personal property tax. But what many college students from out of town may not know is that they are expected to pay it as well.

The city of Richmond’s website cites the general rule under Virginia law – §58.1-3511 of the Virginia Code. It says a car is taxed where the vehicle is normally garaged or parked.

There is an exception if the vehicle is owned by a full-time student attending an institution of higher learning. In that case, the vehicle is taxed in the locality of the student’s permanent residence. Students don’t have to pay Richmond’s property tax if they have paid the tax at their home locality and have documentation to prove it.

The exception does not apply if the student’s parents own the car. In that case, the car is eligible for taxation by the city of Richmond.

Obeying the rules governing personal property taxes is more than just a civic duty. Students at Virginia Commonwealth University and other urban schools have an extra incentive: They must pay property taxes in order to obtain a Residential Restricted Parking Permit – a decal required for parking in such Richmond neighborhoods as the Fan and the Carver area.

VCU sophomore Emily Hess said she did not know about the law. She drives a car, from a different permanent residence, registered under her parents’ names.

“I feel like that’s one of those weird laws no one pays attention to,” Hess said. “It doesn’t make any sense; you’d think it would be the other way around. I don’t know how I feel about that.”

Hess said that at some point, she may need a Fan parking pass, although she currently parks on the street without a permit.

Fellow VCU sophomore Kelly Culbertson is from Norfolk. Like Hess, she was unaware of the property tax rules.

“I think that’s whack because most second-year students live in apartments and have cars,” Culbertson said. “Most of these cars were a gift of some sort, and they’re not the ones paying them off.”

While Culbertson has a vehicle with her in Richmond, she parks in one of the university’s decks during the school day and in a private lot at her apartment. Next year, though, street parking may become the norm for her. Culbertson said VCU should take the helm and educate students who may not understand why they owe the city.

“They could do service announcements,” Culbertson said, “or partner with VCU and put information out in the TelegRAM” – the university’s daily email.

Unlike Hess and Culbertson, VCU junior Nicole Little thinks the tax is a fair way for students to pay for city services they use. Her car is in her name, and she received a bill in the mail to pay property taxes and complied.

“Personally, I think it is necessary,” Little said. “I don’t know what it takes to maintain the streets and roadways here. VCU is annoying to Richmonders and invites an excess of car and pedestrian traffic. I live here in the summer, too; I should have to pay what a normal person has to pay. I’m OK with it.”

The city’s personal property tax rate is $3.70 per $100 of assessed value for passenger vehicles. That means that the annual tax on a car worth $10,000 would be $370. However, the state has a tax relief program that exempts most of the tax. So the actual tax bill on a $10,000 vehicle would be $148.


For More Information

To ensure that your vehicle is recorded on the tax records of the appropriate locality, contact a tax representative of the city of Richmond at 804-646-7000. Or visit the city’s website at www.richmondgov.com